You’ve found the perfect apartment. The rent fits your budget. The security deposit is reasonable. And then, you see a lease fee. What is a lease fee, and why is it there? Let’s unpack it below.
Main Takeaways
- Lease fees cover the administrative work involved in processing applications and preparing rental agreements.
- They are typically one-time, upfront charges and may vary by property or management company.
- Tenants should always ask about the fee’s amount, due date, and refundability before committing to a lease.
What Is a Lease Fee?
When you sign a new lease with a property management company in Philadelphia that explains all rental costs upfront, you may be asked to pay a lease fee upfront. In most cases, this fee covers the initial work involved in setting up your lease, including processing your application, preparing the necessary paperwork, and finalizing your lease agreement. It’s typically a flat amount or a percentage of the rent, and it’s often included as part of the administrative or move-in fees.
Why Do Landlords or Property Managers Charge Lease Fees?
Preparing a rental for a new tenant involves several important steps before move-in day. From marketing the property and showing it to prospective renters, to screening applications, handling paperwork, and drafting lease agreements, a lot happens behind the scenes to ensure everything is ready.
The lease fee helps cover these upfront tasks that make the leasing process smooth, efficient, and fully prepared for each tenant. Rather than rolling these costs into ongoing rent, many landlords and property managers charge a one-time lease fee to handle the work required before you move in.
How Much Is a Typical Lease Fee?
Lease fees can vary depending on the property and who’s managing it. In many cases, you might see a flat fee—anywhere from $100 to a few hundred dollars—added to your move-in costs. Some landlords or property managers may also charge a small percentage of your monthly rent as part of the lease fee.
In other cases, the lease fee may be equivalent to one full month’s rent, especially when working with professional management companies handling the entire leasing process.
Keep in mind that these fees are often included in your administrative or move-in costs. They’re not extra surprises, but it’s always a good idea to review your lease paperwork carefully so you understand exactly what you’re being charged before signing. That said, some state and local laws set limits around how much landlords can charge, so be sure to check those regulations, too.
Lease Fee vs Security Deposit
It’s easy to confuse the lease fee with the security deposit, but they serve completely different purposes.
Here is how they differ:
Feature | Lease Fee | Security Deposit |
| When Paid | Before or at lease signing | Before or at move-in |
| Purpose | Covers processing, screening, and paperwork | Protects landlord from damages or unpaid rent |
| Amount | Varies — flat fee, percentage, or one month’s rent | Typically 1 to 2 months’ rent |
| Refundable? | Usually non-refundable | Usually refundable if no issues |
| Who Uses It | Landlord or property manager for leasing costs | Landlord holds it during lease term |
Can a Lease Fee Be Waived?
In most cases, no. You typically cannot waive lease fees. Landlords and property managers charge lease fees to cover actual costs, such as marketing, screening, and preparing lease agreements. Since these expenses happen whether a tenant moves in or not, the fee is usually non-negotiable. That said, there are a few times when the lease fee might be lowered or even skipped:
- Sometimes landlords run special offers. For example, they may waive fees during a promotion to fill units faster.
- In some cases, errors may occur during the leasing process. If the fee was charged by accident or added by mistake, the landlord or property manager should correct it.
However, otherwise, landlords and property managers must apply lease fees consistently to comply with the Fair Housing Act. So, while it’s not impossible, tenants shouldn’t expect the lease fee to be waived as part of a typical rental process.
Are Lease Fees Legal?
Yes. Lease fees are legal as long as they’re clearly disclosed, reasonable, and applied fairly to all applicants.
Landlords and property managers are allowed to charge fees to cover the cost of preparing a lease, processing applications, and securing new tenants. However, the exact rules around lease fees can vary depending on state and local laws.
In Philadelphia, for example, there are no specific laws that prohibit lease fees; however, landlords must comply with general tenant protection laws. For example:
- Fees must be clearly listed in the lease agreement.
- Tenants should know upfront what they’re paying for.
- The fee amount should not be excessive or misleading.
- Fees should be applied consistently to all applicants to avoid discrimination.
If a lease fee seems unusually high or wasn’t disclosed properly, tenants have the right to ask questions or seek clarification before signing. Meaning, you should never feel rushed to sign a lease if you’re unsure about any fee.
Questions to Ask Before Paying a Lease Fee
Before you pay any lease fee, it’s smart to get a few important details upfront:
- Is the lease fee required for this property?
Be sure to check whether a lease fee is required for the unit you’re interested in. Some properties include this as a standard charge, while others may not. It’s best to confirm in advance so there are no surprises. - How much is the total lease fee?
Ask the landlord or leasing office for the exact amount of the lease fee. This fee can vary depending on the property and the management company. Knowing the total helps you budget more accurately. - When is the lease fee due?
It’s important to find out when the lease fee is expected—typically due at lease signing. Clarify the exact due date so you can plan accordingly. Paying late could delay your move-in. - Is this a one-time fee or will it be charged again at renewal?
Find out whether the lease fee is a one-time charge or if it recurs at renewal. This helps you understand future costs and prepare for potential recharges. Long-term planning starts with clear details now. - Is a lease fee refundable under any circumstances?
Always ask whether you can refund the fee, especially if you know your plans might change. Some fees are non-refundable. On the other hand, you may be able to get some of them back under specific conditions (or if your state or local laws require it). By clarifying this early, you can avoid any misunderstandings later. - Are there any other move-in fees I should budget for?
In many states, your landlord must inform you of all your fees upfront. That said, it can’t hurt to be reminded of them again. So, you should ask your landlord about their other costs beyond the lease fee. For example, there could be security deposits, application fees, or utility setups. These charges can add up quickly if you’re not prepared.
Asking these simple questions upfront can help you avoid confusion and fully understand your move-in costs.
Professionally Managed Properties vs. Private Landlords
Whether you’re renting with a larger company or a private individual, you may encounter lease fees. That said, they can look a little different depending on who you’re renting from.
In professionally managed properties:
Lease fees are often more standardized. Property managers should have clear policies that apply to all tenants. You might see fees bundled into an administrative or move-in package, and they should be disclosed upfront as part of the leasing process.
In private rentals (individual landlords):
Lease fees may not be as common here, but they can still appear. Some private landlords handle the leasing process themselves, and so they sometimes (but not always) may choose to not charge a separate lease fee. Like larger companies, they must consistently apply those fees towards all renters equally.
Others may hire leasing agents or property managers, in which case, similar fees may apply. Since private rentals can vary, it’s especially important to review the lease and ask questions about any fees before signing.
Need Help Navigating Lease Fees and Rentals? We Can Help!
A lease fee is an upfront charge that landlords and property managers often require. It covers the administrative costs of processing applications, preparing leases, and finalizing rental agreements. Even though it’s common and legal in many places, you should still ask about the fee’s amount, timing, and whether it’s refundable before signing.
Understanding fees is just one part of finding the right rental. If you want a team that takes the stress out of renting and handles the details for you, we’re here to help. Need help with leasing or managing your rental? Bay Property Management Group makes the process simple. We take care of the paperwork, fees, and move-in preparation, allowing you to focus on settling into your new home.
